Leanne Mannering v Highscore Scaffolding Limited & Anor.

An unstamped instrument is generally inadmissible, but it is not thereby void or invalid. The underlying transaction may be proved by admissible evidence that does not rely on the instrument or secondary evidence of its contents.

Under Stamp Act 1891, the court may permit reliance on an unstamped instrument upon an unequivocal undertaking by a solicitor, acting as an officer of the court, to pay the duty and stamp it. The court must consider whether there is a genuine dispute about the duty or consideration. Where an admissible agreement establishes a binding share-transfer contract supported by consideration, the court may accept such an undertaking and uphold the result.

The appellant challenged an earlier judgment dismissing her claim for rectification of Highscore Scaffolding Ltd’s register of members. She alleged that her single share had been transferred to the second respondent through a forged or unauthorised stock transfer form.

The trial judge found that she had signed the transfer documents and had agreed to transfer the share. The appellant obtained permission to appeal on the limited issue whether the stock transfer form was inadmissible under section 14(4) of the Stamp Act 1891. The central question was whether the original decision would have been different had that issue been addressed.

1. Appeal dismissed. The trial judge should have addressed section 14(4) of the Stamp Act 1891, and the stock transfer form was inadmissible because no exemption certificate had been completed under the Stamp Duty (Exempt Instruments) Regulations 1987.
2. Section 14(4) made the instrument unavailable in evidence, but did not render it void or invalid. The court could not receive secondary evidence of its contents. It could, however, resolve factual disputes without relying on the inadmissible document, as explained in Parinv (Hatfield) Ltd v IRC [1996] STC 933.
3. The first ground in the Respondents’ Notice failed. The memorandum of agreement was not the usual form of share transfer under Regulation 23 of the Companies (Tables A to F) (Amendment) Regulations 1985, and it could not itself prove compliance with that requirement while unstamped.
4. The memorandum of agreement nevertheless constituted a binding contract. An agreement to exchange shares, and an agreement not to take up shares or acquire a beneficial interest, could amount to good consideration even though no payment in money or money’s worth was stated.
5. Section 14(1) permitted the court to receive the stock transfer form upon an unequivocal undertaking by the respondents’ solicitor to pay the duty and stamp it. The settled practice recognised in Re Coolgardie Goldfields Ltd [1900] 1 Ch 475 was applicable. McGuane v Welch [2008] EWCA Civ 785 and Semple v Semple [2006] CSOH 180 did not prevent that course, since the present case involved an established agreement and no genuine dispute requiring the court first to rely on the unstamped document.
6. The required payment was £12. The trial judge would therefore have reached the same conclusion if the section 14(4) point had been taken. The respondents were awarded £19,000 plus VAT in costs, payable within 28 days.

1. High Court (Chancery Division): the trial judge dismissed the appellant’s claim for rectification and related relief. She later dismissed an application to set aside the judgment and refused permission to appeal.
2. High Court (Chancery Division): permission to appeal out of time was granted on the limited section 14(4) issue. The appeal was dismissed.